TORONTO, Oct 15 Ontario Premier Dalton McGuinty
announced on Monday he was resigning as head of Canada's most
populous province just one year after winning a third successive
term, saying it was time for a renewal in leadership.

The province, which accounts for about 40 percent of
Canada's economy, has been battling huge budget deficits and
slow growth since its record shortfall of nearly C$25 billion
($25.58 billion) in 2009 during the global recession.

McGuinty, who will stay on until his Liberal party finds a
successor, asked the provincial lieutenant governor to end the
legislative session, which means work on all bills would come to
an end.

"After 16 years as leader of the Ontario Liberal Party and
after nine years as premier, it's time for renewal, it's time
for the next Liberal premier," McGuinty said.

Provincial opposition leaders slammed the decision
to adjourn the legislature because of a number of big issues
facing the province, including battles with the public sector
over wage freezes and controversy over the cancellation of two
natural gas-powered electricity plants.

"I don't understand his decision to suspend the
legislature," Tim Hudak, leader of the opposition Conservatives,
told a news conference.

McGuinty's departure could mean Ontario will be going to the
polls as early as next spring, according to political analysts.

The premier was asked by reporters whether he would run in
the race now under way for the leadership of the federal Liberal
party but said only, "I don't have any plans."

Dubbed by critics as the Teflon leader for his ability to
escape crises, McGuinty became Leader of the Ontario Liberal
Party in 1996 and led his party to a majority government in 2003
and in 2007. In 2011, his party managed only a minority
government, meaning the government would need to broker deals
with opposition parties to pass legislation.

Since winning re-election, McGuinty's Liberals have been
dogged by scandals such as mismanagement of Ontario's air
ambulance service and contempt charges against the energy
minister for being slow to release documents related to the
costly cancellations of the two gas-powered plants in the
province.
Ontario has been struggling with a high budgetary deficit
but announced on Monday it was cutting its shortfall faster than
projected, crediting higher-than-expected growth and tax
revenues.

In its budget this spring, the government vowed to rein in
public sector labor costs, halt corporate tax cuts and raise
taxes on the wealthiest earners.

In its autumn economic statement, Ontario projected the
2012-13 deficit would be C$14.4 billion ($14.69 billion), down
from the C$14.8 billion forecast in April.

It kept its 2013-14 and 2014-15 deficit forecasts at C$12.8
billion and C$10.1 billion, respectively.

The premier's resignation will also be watched by the
province's creditors as debt rating agencies raise scrutiny of
the province's finances.

" It adds an element of uncertainty to the implementation of
the fiscal recovery plan as a new premier could have different
priorities," Eric Beauchemin, managing director of public
finance at the credit rating agency DBRS, told Reuters.

"Nonetheless we know that the province remains on track with
its plan as reflected in the fall statement released today,
which we find encouraging."

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